World Economic Leaders Act To Counter Financial, Food Crises

[Purveyor]

Source: Agence France-Presse

WASHINGTON (AFP) - World economic leaders here this weekend took steps to alleviate the worst financial shock in decades and a food price crisis that is sparking deadly unrest in developing countries.

In three days of meetings that ended Sunday, finance ministers and central bankers grappled with the credit squeeze and inflation emergencies against the backdrop of an apparent US recession and a sharply slowing global economy.

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Confronted by what the IMF head says is the worst financial crisis since the 1930s Great Depression, finance chiefs from Britain, Canada, France, Germany, Italy, Japan and the United States decided only greater transparency in the financial system could restore normalcy to the markets.

The G7 endorsed recommendations from an international forum and set for some of them a deadline for implementation unprecedented in its brevity -- 100 days.

Recommendation is a "gentle word," said Bank of Italy governor Mario Draghi, who also chairs the Financial Stability Forum that made the proposals. "In fact some of these recommendations are actually policy decisions."

The sudden nosedive in the global economy after several years of robust growth "even six months ago would have been unthinkable," he added.



Read more: http://news.yahoo.com/s/afp/20080413/bs_afp/imfworldbankeconomyg7_080413212653;_ylt=A0WTUeBfjAJIIGsAvx6FOrgF

[WTyler]

1. Could anyone explain to me...

what is going on with the world food market? Until very recently I had assumed that the rising food costs in the United States were due to the falling dollar and rising transportation costs. Obviously that isn't the case in the places that have been having food riots. What is going on that is causing a global food crisis?

[daleo]

3. It is a good question

The right wing media seem to be pushing an "environmentalist created bio-fuels" meme. Most environmentalists have been against bio-fuels, as there is a consensus that the process doesn't produce more energy than it consumes. I agree that bio-fuels are part of the problem, though they are much more favored by by agri-business than environmentalists.

Still, something tells me that is a distraction from something more fundamental. It may have something to do with the credit crisis, or the instability in currency markets. Peak oil may be making fertilizers to expensive for "green revolution" agriculture. It may be something akin to the enclosures of the 1800's, where capitalist development pushed smallholders off farms in favor of large scale livestock raising.

It will take a while for the picture to become clear, I think.

[madrchsod]

5. speculation

no money in housing,oil ,or gold...commodity futures is in play now...when they run that out it will be something else...i heard tulips maybe the next big thing

[tama]

7. Simple, really

Demand of food has surpassed supply for several years now (global grain stock falling for 8th year now) creating the underlying fundamentals for a "commodity bubble". And with the financial bubble of big capitalism bursting, that underlying fact creats treshold for the speculators (with aid of practically free debt) to create bubbles in commodities - leading to acute famine of too poor to buy food few years before the "real" famine would hit. That's capitalism for you.

In most simplest terms, peak oil -> peak food -> peak population, and market liberalism just making things happen in fast forward.

[Arctic Dave]

2. "Alleviate" meaning, passing the bill from them to the underclass.

[Demeter]

4. Monsanto, Climate Change, Diet Shifting, and Greed

Farmers were starving, so they quit farming or went under. And their governments didn't care.

[sbyte]

6. Bio-fuel growers sucking up all the fertilizer, It is becoming scarce.

Went to the farms store and all the lime is sold out. And they are telling me the bio-fuel farmers are sucking it all up. And then the price of LP gas is up which is what they make the high test nitrogen fertilizer out of.

Commodity's are growing scarce:

(From a Larouchpac report on the Physical Economy..)

Rice The tonnage of rice available for importing this year is falling drastically. The USDA estimated in March that rice for export was trending downward from the level of 30.85 mmt traded in 2006/7, down to perhaps 29.39 mmt to be traded this year. But this fantasy does not reflect the recent announcements by major rice exporting countries that are now limiting or banning exports. Of the 29 million metric tons of rice for trade or aid, only seven nations account for 27 mmt, and four of them have restricted exports, possibly adding up to a "loss to the markets" of 11.2 mmt. They are (their "normal" annual export tonnage is noted): Vietnam (5 mmt); India (3.5 mmt); China (1.3 mmt); Egypt (1.3 mmt). Additionally, Pakistan, which exported some 3 mmt in recent years, has none for export, and is beset by grain going to Afghanistan. Thailand, the world's leading grain exporter, is also restricting exports. Thus, 24.2 mmt, or over three-quarters of all the rice traded on the world markets, may not be there in coming months.

[The2ndWheel]

8. Great, so they're going to make it worse